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Trademarks - No suit for passing off maintainable if plaintiff’s use not honest

The Delhi High Court has held that plaintiff which is a sister concern of and hired by Elder Pharmaceuticals Ltd. (EPL), cannot claim latter’s trademark and reputation on liquidation of EPL.

Holding that such use with the knowledge of registration of trademark is not bona fide, the court observed that post liquidation proceedings, Plaintiffs started using the Elder trademarks in relation to the goods manufactured and sold under their own name without the permission or consent of EPL and thus such use of the mark cannot be characterized as “permitted use” and would amount to infringement.

It observed that the official liquidator who is the custodian of assets of liquidated company can claim benefits of reputation and goodwill of its trademarks.

The High Court in the case of Elder Projects Ltd. v. Elder Pharmacia LLP also held that for acquiescence under Section 33 of the Trademark Act, use must be for a continuous period of 5 years and hence Plaintiff cannot claim acquiescence. Plaintiff’s claim of shared reputation was also rejected by the Court observing that both plaintiff and defendant were infringers.

It held that it was a case of a senior infringer suing a junior infringer. Dismissing the suit with costs, the court was of the view that Plaintiff cannot succeed on the claim of passing off because the use of the mark was not honest or bona fide and was also conflicting and infringing the registered marks of EPL.

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